My rights vs. Your profits: it’s the environment, stupid

Photo by Alex Hiller on Unsplash

So economic theory goes that consumers act rationally at all times. Homo economicus is however largely a myth, especially in light of a sophisticated, multi-billion dollar global marketing industry that influences purchasing decisions, and government regulation which favours businesses over consumers. But, when it comes to the repair of malfunctioning, damaged or broken goods, consumers do tend to act entirely rationally. That is, they don’t bother….the rare exception being those few individuals who place an abnormally high value on mitigating environmental damage and reducing their carbon footprint.

As things stand, it is generally less rational — whether due to higher cost, more time, greater inconvenience, or all three — to repair something than to buy it new. By and large, the benefits to consumers of buying new and thus reinstating manufacturer warranties and enjoying broader consumer rights outweigh less immediate self-interests such as environmental costs or supporting local jobs. The advantages of manufacturers’ scale, market dominance and the ability to offshore variable costs to cheaper markets makes buying new attractive. Conversely, individual consumers are saddled with bearing the full brunt of Australia’s relatively high labour costs when it comes to repair, if they are even permitted and able to do so.

Therefore, quite simply, a ‘right to repair’ must translate to access, affordability and attractiveness to repair.

Government, business, and consumers each have a vital role to play to ensure it is so.

I have lived in places where (and in an era when) people repair things. By choice. There is no inherent difference between people of those places and times versus Australian consumers today. What has changed are the perverse and out-sized incentives of companies and manufacturers to shorten the life of their products, to create real barriers to fixing them, and to drive a cultural shift of manufactured desire for the next shiny thing. #FOMO

On a finite planet with genuinely scarce resources, this is a problem!

It seems like stating the obvious to insist that the most instinctual, convenient and rational choice should be to extend the life of a thing as long as possible and extract as much value as possible. It’s only marginally less prosaic to suggest that the active discouragement of excessive resource consumption must be employed at every turn. Yet here we are arguing the relative merits of a legislated ‘right to repair’. (The Australian Productivity Commission is currently holding an Inquiry — make a submission here).

Whether by accident or design, Australia offshores all aspects of pre and post life of electronics goods to more vulnerable nations — from the mining of rare minerals and the low wage manufacturing work (which seemingly does not translate to lower purchase costs for consumers), through to the end-of-life waste management problem and the risks posed to health in resource recovery. As a nation of voracious consumers of devices, we are only, blissfully, middle men and beneficiaries of other people’s problems. Although, it’s worth noting we also lack a mature industry of those highly paid software developers, engineers and innovators.

What’s more, the market for second hand goods is artificially suppressed. This, I believe, is due to changing consumer norms (driven by vested interests) and the emergence of a ‘disposable culture’ mindset. There are disincentives for potential secondhand goods buyers including fewer or a complete absence of consumer rights, while there exists contrary incentives for product manufacturers with their enormous influence and deep pockets to sell, sell, sell. The barriers to choosing refurbished and secondhand goods are only exacerbated by the absence of an unimpeded right to repair.

Then there’s the fact of planned obsolescence.

Premature and deliberate (or unintended yet effective) factors that render an item unusable removes individuals’ freedom of choice, and creates an unmitigated environmental disaster. Whether it’s the seeming conspiratorial decision by smartphone manufacturers to remove the headphone jack from all post-2020 devices, or the cessation of iTunes which forced music lovers to throw away their iPods, lose access to music libraries they’d paid for, and sign up to monthly streaming services (and devices capable of hosting them), or the literal impossibility of obtaining a replacement battery/screen/case/workable software update for any phone more than about 4 years old, planned obsolescence is an intrinsic part of the modern business model. And it’s not just digital devices. Airbags, timing belts, braking systems, wheel alignment issues can all spell ‘time to get a new car’. “They don’t make ’em like they used to” applies to motor vehicles perhaps more than any other invention of the 20th century.

This higher-than-expected rate of replacement is always labelled as ‘technological advancements’ or ‘innovations’ or ‘design improvements’ by way of justification. It seems plainly evident it’s simply a business model bolstered by advertising-driven, artificial demand for ‘new’ which makes people believe that there is always something better/bigger/faster available. On anecdotal evidence alone, I refute that it is difficult to identify deliberate attempts to reduce a product’s lifespan so as to forcefully encourage a consumer to replace it versus mere ‘upgrades’.

Since its release in 2007, there have been 12 versions of the standard iPhone. To assess whether this is responding to genuine technological change, I propose a features and capabilities comparison. I suspect the marginal benefit to the average consumer is minimal. To make a further assessment, compare the associated price tag of each version. Surely economic theory instructs that if one thing is far superior to another thing in the market, then the input costs must be comparatively higher and therefore so must be the priced charged to consumers. It is not so with consecutive iPhones. Meanwhile, Apple have long since stopped updating let alone repairing that first version (or even the iPhone 8 released in 2017), meaning they are no longer usable.

Consumers already face a hostile sales environment that pressures them into phone upgrade at end of their 2 year contract — which always seems to coincide with faltering battery life and slower performance. It has long been accepted wisdom (not to mention legally enforceable under Australian Consumer Law) that products should be fit for purpose for a reasonable period. With a price tag approaching the equivalent of an average worker’s weekly wage, it cannot seriously be claimed this is a ‘reasonable’ timeframe for guaranteed usability.

If a ‘natural evolution’ defence is to be used as a means to diminish the right to repair, there must be a level playing field in order to restore consumer choice. If I am a luddite and don’t wish to ‘evolve’, I must continue to have that choice now and into the future. If an economic defence of manufacturers’ profits is to be espoused, a rebalancing of the relative costs to consumers and to the environment must equally be considered.

Tax companies on products (or components) with short lifespans which ‘cannot’ be repaired

Manufacturers should be obligated to take responsibility for the lifecycle of primary materials used, such as rare mineral recovery and the burden of landfill

Products ought to be taxed for the proportional use of primary/raw materials versus recycled ones

Mandatory industry contributions or compulsory membership of individual manufacturers in recycling schemes and e-waste solutions

We should not suppose that the community should not be impacted through financial penalties and disincentives, such as heavy taxation and regulation suggested above, when it comes to opting for new over repair. We are on the precipice of irreversible environmental disaster, and without radical interventionist policies that force attitudinal and behavioural shifts, humanity will be unable to save itself from this existential crisis. Manufacturers must be incentivised to mitigate their impact and penalised for choosing not to. Of course those costs will be passed on. Government’s role must be to enable individuals to make rational economic and environmental choices aligned with the greater need to consume less, including through a robust right to repair. Once in place, a manufacturer’s decision to produce goods with short lifespans or create barriers to repair, and an individual’s choice to buy new or not repair goods, must attract consequences.

“It’s the environment, stupid.”

And what about the waste?

The problem with e-waste isn’t that it is uniquely (potentially) more damaging to the environment than general waste. The problem is that it’s a new and increasingly large form of landfill which is not replacing nor proportionally reducing other types of waste. We just keep adding more and more of the stuff.

To deal with this looming crisis takes a two-pronged approach. In the primary (sales) market, taxation has a role. But it is essential that a right to repair and a thriving secondhand market enabled by stronger consumer protections complements and supports rational consumer decision-making.

Whereas planned obsolescence adds to the e-waste problem due to premature failure of devices, the right to repair and fostering a culture of repair would make a secondhand market more viable. When new products do enter the market, it is less likely still-working devices would be so readily discarded. People sell outgrown babies’ items and already-read books to a pool of willing buyers — there is no obvious reason except the existing artificial barriers to owning and maintaining a device with confidence of one’s legal rights that these products cannot find a hand-me-down market.

The way I see it, a right to repair and investment in the repair market will revive Australia’s fading manufacturing capabilities and ensure we remain a nation that makes things. Genuine competition and the choice of independent repairers, rather than the limits imposed by restricting the repair to ‘authorised repairers’ can only benefit consumers and the broader local economy through job creation and upskilling.

Original Equipment Manufacturer (OEM) warranties lock in consumers who are informed — rightly or wrongly — that they must use authorised repairers to fix something even if not covered by warranty or else the warranty is forfeited. An owner’s right to repair is so minimised that an independent repairer who investigates a problem to provide a quote to fix it may void the manufacturer warranty. How is a consumer able to make an informed choice about a course of action?

I am a scooter owner. My three year manufacturer warranty dictates that I undertake mandatory servicing at set intervals. Servicing by an authorised repairer is performed at very limited locations and resultantly, at high cost, therefore negating any gains by choosing a cheaper model. In fact, the number of authorised repairers for all brand of scooters is so limited that competition in the primary market is irrelevant. Why are there so few? In the age of delivery riders and a renaissance in two-wheeled transport to beat traffic congestion, I question whether authorised repairers are adequately compensated under warranty schemes, or if the fees paid to them to repair under warranty creates an economic environment which discourages them from participating in the scheme. Or is it deliberate constriction of competition to drive up the cost of servicing and repair?

Either way, I feel sure that manufacturer refusal to allow independent repairs with the reasoning of ‘quality assurance’ removes choice and decision-making autonomy from the consumer (that is, the rightful owner) of the product. And again, OEM servicing is only of benefit when buying new goods and further discourages a secondhand market.

Finally, an economic theory that purports OEM servicing (and thereby non-competitive repair markets) creates downward pressure on product prices is clearly disproven by the case of iPhones which are not made cheaper to buy by being difficult to get fixed. And the argument that consumer data security is at the heart of restricting repairs to authorised repairers is a nonsense, or otherwise easily remedied. If there was legislation which made issues of data security for all repairers equal under the law, and if info sharing in the industry between all repairers was mandated (such as proposed for vehicle repairs), there would not be valid concerns about repair quality, safety nor security between OEMs as compared to independent repairers. Indeed, a non-competitive repair market increases risk to privacy and data security if my most rational choice is to throw away a personal device without deleting its contents because of the prohibitive costs or hassle to repair it first. Who’s to say it wouldn’t subsequently be rescued by someone with the ability to fix it and access my personal information?

So then, the only argument left against the right to repair is the intellectual property rights of manufacturers. While multinational companies may forfeit their monopoly profits if the right to repair becomes enshrined in law, my sympathies are not loyal to them and neither should be the government’s. Instead we should be pioneering an age where business model impacts on the environment are not merely deemed ‘externalities’. We could be leading a resurgence in the values of the ‘make-do’ post-war generation. We ought to be demanding that real world impacts be reflected in the cost of business and in product pricing so that informed consumers continue to make rational economic decisions that actually fit the theories upon which our system is built.

If I bought it, I own it, and if I own it you have sold your right to control what I do with it, and if I control what I do with it I have the right to repair it if I choose to….and I will chose to.

Reframing what we value — a world which is just, sustainable, and works for all people and planet Earth. Join the conversation!